ERP Accounts for 43% of Corporate App Spending Says Report

The brake that Y2K spending put on corporate spending on enterprise applications may have been most severe in the ERP sector, but a recent AMR Research survey of 800 companies in 13 industries found that ERP still grabs the largest share of respondents’ corporate application budgets at 43%. Half of those companies have ERP installed. […]

The brake that Y2K spending put on corporate spending on enterprise applications may have been most severe in the ERP sector, but a recent AMR Research survey of 800 companies in 13 industries found that ERP still grabs the largest share of respondents’ corporate application budgets at 43%. Half of those companies have ERP installed.

The report finds that 17% of application spending went on CRM, but despite the hype surrounding this class of programs which help users sell new services more accurately AMR says that the market still lacks a prominent vendor. Siebel has 17% of the market by revenue, though only seven of the 800 companies were found to be using Siebel’s software. SCM accounts for 13% of application spending; and 20% of the 800 are doing SCM. Manufacturing software including plant scheduling, maintenance management, product data and document management accounted for 16% of spending.

High-tech, pharmaceuticals and financial services spent the most of the 13 verticals on enterprise applications. AMR says that a $250m financial company will typically spend $700,000 on ERP software, $400,000 on CRM and $1.5m on related services this year. High-tech companies invest 28% of IT budgets on enterprise applications. Most spending goes on ERP, the rest is spread across other enterprise applications. Pharmaceutical companies spend 20% of their IT budgets on enterprise applications, mostly CRM and SCM. Financial companies fork over 15% of IT budgets on enterprise software, most going on ERP and CRM.